The IKEA Effect

Sometimes, labor can lead to love (and an increased willingness to pay). When instant cake mixes were introduced in the 1950s, consumers were initially resistant: the mixes made cooking too easy! After discovering this, manufacturers changed their recipes to require adding an egg to the cake mix. While not strictly necessary, adding the egg made home cooks feel like they had really made the cakes on their own, causing them to enjoy both the cake and the experience more. As a result, cake mix sales shot up. (1)

Curious about this effect, behavioral scientists Michael Norton, Daniel Mochon and Dan Ariely designed a series of four studies in which they asked participants to assemble IKEA boxes, fold origami, and build sets of Legos. In these experiments, they found that people attach greater value to the things they build than to those same products built by someone else. This was true both for the more utilitarian products (the furniture) and the less utilitarian (the origami and the Legos). (2)

There are many possible explanations for this effect. One is that the effort involved in successfully completing a task generates positive feelings, such as competence. Assembling a product also gives people time to focus on its positive attributes. This finding is particularly relevant today, as many companies move from mass production to product customization and co-production of value, a shift that is increasingly popular with consumers.

Applying this insight

Some toy stores offer a service that allows customers to build their own teddy bear (think Build-A-Bear). They come in, pick the bear, pick bows or clothing, and sometimes even get to pick the bear’s eyes. When everything is picked out, they take the bear to an employee, who lets the customer stuff the bear before they stitch and glue everything together. The customer, often a very excited child, loves their new bear even more because of all of the effort they have put into making it. Another, perhaps more common example, is social media profiles. Applications like Facebook or LinkedIn have you put in a lot of effort to craft your profile. Doing this work up front makes people more invested in the service.

Key lesson

When consumers put more effort into making or preparing something, they tend to value it more. However, it’s important to remember that adding effort needs to be balanced with removing barriers and friction.

Exercise

Think about your product or service and how to increase your customers’ perception that they had a role in building it.